IAG shares topped the FTSE 100 risers on Friday, after analysts at UBS upgraded the bank from a neutral to a buy status following belief that a number of political and economical issues will be resolved.
An update from UBS read:
“Despite its share price being up over 25% in 2012, IAG was the worst performing European airline share under our coverage, underperforming Lufthansa by over 30% and Air France KLM by around 45%. We think that IAG could be the laggard most likely to outperform in 2013 should it achieve the concessions the company wants from Iberia staff.
During December we were somewhat surprised that an accord with the Spanish unions to reach an agreement on a five year labour deal was agreed and strikes called off. We think some of the Iberia restructuring risk has dissipated and, although still challenging, we are becoming more confident on positive talk results.
Despite the tough conditions in Europe with its international network, we see the company as a play on global economic recovery. Furthermore, should the fuel prices continue to be stable, and the euro continue to rise or remain stable, then we see 2013 delivering a fuel tailwind.”
